INDUSTRY VOICES As solar exports face near-term hit from Trump's 126% duty, manufacturers to double down on home market

Trump’s 126% antidumping duty may disrupt solar export in near term, manufacturers to remain focused on domestic market

• US imposes 126% duty on Indian solar imports, impacting exports
• Indian firms focus on domestic market, diversifying supply chains
• Waaree, Emmvee, and Vikram Solar see limited direct impact

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The US decision to slap a 126 percent duty on Indian solar imports is likely to disrupt exports in the near term, which will prompt manufacturers to double down on domestic capacity and diversify markets, industry players said on February 25.

On February 24,  the US commerce department set a preliminary countervailing duty (CVD) of 126 percent on solar cells and modules imported from India, claiming the manufacturers benefited from government subsidies.

The decision sent Indian solar stocks crashing by as much as 15 percent in intra-day trade but companies are confident of  weathering the storm.

Not a major worry

“At this stage, the company does not anticipate any material adverse impact on its ability to service its US order book,” Abhishek Pareek, Group Head Finance, Waaree Energies said.

A leading solar PV modules manufacturer, Waaree Energies said the company remains committed to expanding localised manufacturing in the US but also diversifying its supply-chain to build resilience.

The company has been strengthening its US-based manufacturing footprint. The company has an aggregate US module manufacturing capacity of approximately 2.6 GW and is in the process of expanding it to 4.2 GW by the end of the current fiscal.

Pareek said the company has continued to ramp up its deliveries to the US despite the earlier imposition of 50 percent duty on imports from India during 9MFY26.

“The company’s diversified sourcing strategy remains a core strength, and it continues to further strengthen the same, including through its announced investments in Oman aimed at securing fully traceable, non-Chinese polysilicon supply,” he said.

India is the fifth largest importer of solar modules to the US. In 2024, the US imported 54 GW in solar modules, of which India exported 4.4 GW, accounting for 8 percent of the volumes, data from Kotak Institutional Equities shows.

“The announcement may influence trade flows in the near term. However, the Indian solar manufacturing sector continues to focus on strengthening domestic capabilities, enhancing quality standards, and diversifying markets,” Vinay Thadani, Director and CEO, GREW Solar said. He added that the company remains committed to adapting to evolving global trade environments while maintaining long-term growth priorities.

Emmvee Photovoltaic Power, another top manufacturer of solar PV modules and cells, also sees no impact operations, as the company’s integrated solar cell and module manufacturing is primarily aligned with domestic demand.

The company’s domestic sales contributed 99.13 percent to revenue, with exports accounting for a modest 0.87 percent in FY25, JM Financial said in a November report.

“With a strong focus on the Indian market and domestic consumption of its cell output, Emmvee remains insulated from external trade-related developments of this nature,” the company said.

Vikram Solar CMD Gyanesh Chaudhary said the recent US duties apply specifically to Indian-origin cells. “Our US order strategy was not structured around sourcing Indian cells. We already operate with a diversified supply chain for that market, including sourcing from geographies with lower tariff exposure. As a result, the direct financial impact on us is limited,” he added.

Also read: Solar stocks trim losses but Waaree Energies, Premier Energies end down 6-11% on US tariff concerns

Analyst views

Analysts, however, expect additional duties and stricter compliance requirements to affect price competitiveness and shipment schedules of companies exporting to the US in the short term.

“The proposal by the US commerce department to impose countervailing duties… are likely to dampen export volumes from India, which were around 3 GW in the last calendar year, potentially exerting pricing pressures on domestic original equipment manufacturers (OEMs) and can impact the profitability of the solar module manufacturers,” said Ankit Jain, vice president & co group head, corporate Ratings, ICRA.

Jain said redirecting these volumes to India can intensify pricing pressure in the Indian market, which is already grappling with oversupply. The current domestic capacity at 140 GW is expected to grow to over 165 GW by the end of the next fiscal.

Why the duty?

The imposition of duties by the US follows an investigation based on a petition filed by the Alliance for American Solar Manufacturing and Trade in July 2025. Similar probes were also launched against Indonesia and Laos.

The petition filed by the US solar manufacturers, including First Solar, Mission Solar Energy, and Qcells, with Talon PV Solar Solutions, sought an investigation into illegal trade practices by largely Chinese-owned manufacturers operating in Laos and Indonesia, as well as companies headquartered in India for allegedly harming the US industry by violating trade laws.

These duties are different from US President Donald Trump’s global tariffs that have been struck down by the Supreme Court.

When the probe was opened, government officials said India didn’t not see much problem.

The matter remains subject to ongoing regulatory proceedings and the final outcome is expected by July.

Over the past five years, driven by multiple barriers to Chinese solar products, US module imports have been dominated by Malaysia, Vietnam, Thailand and Cambodia, which accounted for over 80 percent of US imports, according to Kotak Institutional Equities.

Over the past couple of years, driven by surging domestic solar module manufacturing capacity, India has become the fifth-largest exporter, accounting for 7-8 percent of imports.

India’s manufacturing capacity under the Approved List of Models and Manufacturers (ALMM) for solar modules has reached around 144 GW an annum from 2.3 GW in 2014, official data shows.